Ten Questions About High Street
Robert Thomas
After topping Canadian Automobile Association's Worst Road in the Province poll, the City of Moose Jaw took action, removing it's road construction crew from the job and taking on the completion of Phase Two of the Water main Replacement program, on High Street West, for themselves.
The Canadian Federation of Independent Business (CFIB) asked the City to mitigate the damages of the businesses most severely affected by the project. The CFIB also asked that measures be taken to help ensure it would never happen again.
To help get a better understanding of the CFIB's findings and position, as well as the impact the construction has had on the High Street businesses, MJ Independent submitted 10 written questions to them.
In verbatim, below, are the questions and the CFIB's written responses
1. You recently interviewed a number of High Street businesses, what were your findings when it comes to the effect of construction on their businesses?
The reality is that the construction project on High Street West was supposed to only take three weeks, but after almost nine months it is still not complete. Angry business owners have told us the delays have resulted in customers having limited access to their businesses, significant losses of business income, damage to their sewer lines and premises, and added stress and anxiety.
To add insult to injury, one business owner told us his water and sewer lines were disconnected for almost four months and yet they continued to receive water bills. Another business owner even resorted to offering ‘inconvenience bucks’ to attract customers, while access to another High Street West business owner’s store was blocked for an entire month.
The City’s lack of communication with the affected business owners has also left them completely frustrated and looking for answers. In fact, some business owners told us they have called the City to discuss their concerns, but have received no response to date. This is simply unacceptable. CFIB spoke to High Street West business owners – please see their direct quotes below:
“Delays impact our emergency response times and ride. (Our ambulances) are only as smooth as the ride. The solutions offered were not always compatible with the way in which we respond to emergencies.” - Emergency Services Provider
“The road in front of my store was blocked for a month. Only after a month was it finally reopened. My water was also turned off for three months, and the City had water piped in with a hose which froze regularly. At one point, my business had no water for three weeks. Even though I did not receive a water bill, not paying for water was a drop in the bucket compared to the thousands my business has lot in sales.” - Retail Business
“Our sales have been drastically impacted as a result of people avoiding the area. Traffic down the street has reduced immensely. There has also been very poor communications from City Hall on the delays. The contractors even damaged my business’ parking lot from driving heavy construction equipment through it constantly. Our water was also cut off without any notice, and yet we still received water bills.” - Home Interior store
“Our sewer in front of our business was damaged and it flooded our bathroom. Our business was without working sewer lines for three weeks, and yet we still received a water bill. For three months we had to use a piped in water hose, and use an outhouse in the dead of winter.” - Lumber yard owner
There was a severe lack of communication from the City on the delays. The construction has definitely impacted my business. Our monthly sales went from $14,000 p/m to just $2,500 p/m due to the lack of traffic. Also, after cutting off our water for almost four months we still received a water bill.” - Retail Business
From a national perspective, CFIB’s report, Paving a Smooth Road: Helping small businesses survive infrastructure work, is the first to evaluate the overall impact of road work on Canadian businesses. It found that as many as 65,000 businesses over five years have been affected by road construction projects and often had to borrow, relocate or close down altogether. Lower sales, higher costs, added stress and even closure are just a few of the devastating consequences road construction wreaks on thousands of small businesses every year.
It also found that since 2012, 41 percent of them have been affected by road construction projects, with five per cent affected in a major way. In the long term, this means that one out of five businesses could suffer from the consequences of poorly planned projects.
Nearly half (46 per cent) of respondents affected by such construction said their sales had declined. Almost one in four (23 per cent) experienced a significant level of stress, and more than one in five (21 per cent) had to draw on personal or business savings. Seven per cent even considered closing or relocating their business. The same survey indicates that only three out of ten small business owners have been satisfied with municipal governments’ handling of local construction projects’ negative impacts.
2. One thing you suggested was for the City to track and give businesses early warnings of impending construction. How would such early warnings and updates be beneficial to businesses?
Yes, one of CFIB’s key recommendations is for municipalities to apply a “no surprise rule” mandating the municipality to track its infrastructure’s condition and let local businesses know of construction well in advance. A good way for cities to do that is to have a state of the infrastructure report, a 5-year capital investment plan and relevant pre-construction consultation with all impacted businesses. Providing business owners with ample advanced notice of construction project allows them to better prepare, as well as provides them ample notice for them to notify their customers. Notice should be provided through a number of different channels, including using the City’s social media channels, proactively emailing all impacted businesses (e.g. bi-weekly emails with project updates), physically dropping off multiple notifications in person at the impacted businesses, putting notices up throughout the community, calling each business owner individually to notify them, and posting the notification somewhere visible on the City’s website.
3. When you spoke to the High Street businesses did you do it in person? If so, what condition did you find High Street?
After being contacted by a number of angry High Street West business owners, Jennifer Henshaw, CFIB’s Senior Policy Analyst for Prairie went to Moose Jaw to meet with a number of High Street W. business owners in person.
In fact, one business owner offered to drive Jennifer down High Street West to show how extremely rough the road was. The road had large ruts and was almost impassable by car. It is not surprising that High Street West has officially been named the worst road in the province according to CAA Saskatchewan.
4. What are your thoughts about the City stepping in and taking action to get the work done and road repaired?
CFIB acknowledges the city’s plan to take over the completion of the unfinished road construction on High Street. While this is a step in the right direction, it does not help the impacted businesses that have seen their sales plummet and are struggling to stay afloat. Now is the time for the City to take decisive action and implement a comprehensive construction mitigation policy as soon as possible to ensure those High Street West business owners who have been the most severely impacted by the delayed water main replacement project are fairly compensated for their losses.
5. Although High Street has its accessibility problems at the present time what sort of message would you like to send out to people who shop or might consider shopping there?
It is extremely important to support Moose Jaw’s hard-working, local, small businesses that are the backbone of our economy and play such an integral part of our community. Small, independent businesses are fundamental to a strong and growing economy. Nationwide, they employ more than 70 per cent of the private sector labour force and create the bulk of new jobs. CFIB urges everyone from Moose Jaw and beyond to make the effort to support our local small business owners and to recognize the impacted High Street West businesses by supporting them as much as possible.
6. The City of Moose Jaw may have turned down your requests for financial mitigation is there anything they can do as a City to help the High Street merchants out?
We are disappointed that the City failed to take decisive action at Monday evening’s Executive Committee meeting to address business owners’ concerns with the ongoing construction delays. While the City is taking over the completion of the unfinished construction, what the City needs to do provide the affected business owners with a detailed plan and timeframe for the completion of the road construction on High Street, and mitigate the impact of the delayed construction by offering compensation, even in the form of waiving property taxes, utilities or business licenses for those most severely impacted.
7. You have asked for the City to mitigate the losses for High Street businesses why do you think this is justified?
The presence of local businesses on local streets plays a key role in making our cities and neighbourhoods vibrant, by providing local services and jobs, among other things. Local businesses also help fund collective services through their taxes.
While local businesses will no doubt be large beneficiaries of an infrastructure update, they also pay an even greater share of the bill. Huge economic costs of construction are unfairly offloaded on them.
As we have seen on High Street West, when the street is under construction for too long and when sales drop too much, many small businesses struggle, take a very long time to recover or simply disappear. This is similar to temporary expropriation, but without any compensation. These disruptions affect our economy, our neighbourhoods and they are also unnecessary because they could be avoided if projects were better managed.
Moreover, by failing to properly mitigate the negative impacts of construction, our governments harm local economic activity and thus their own tax base. That ultimately has an impact on other taxpayers. On the other hand, better managed projects will also reduce some of the negative impacts construction has on everybody, like traffic, congestion, reduced access, etc.
8. In the end though is it not the taxpayer - both residential and commercial - who foots the bill for any sort of mitigation. Is this fair?
While local businesses will no doubt be large beneficiaries of an infrastructure update, they also pay an even greater share of the bill. Huge economic costs of construction are unfairly offloaded on them– more so than residential property taxpayers. CFIB’s research also shows that, in 2016, Moose Jaw commercial property owners pay 2.59 times what residential property owners paid in municipal property taxes. That means that for every one dollar a residential property owner pays, a commercial property owner paid $2.59 on the property with the same assessed value.
Therefore, business owners have already paid more than their fair share of the tax bill and deserve to receive some form of mitigation.
9. With Moose Jaw having decades of infrastructure replacement scheduled are you hopeful your efforts for the High Street merchants, although not successful, might help other businesses and residents endure a repeat?
CFIB will continue to push the city to improve communications with the impacted businesses, and introduce a comprehensive construction mitigation policy, which features a compensation program for those impacted to ensure this never happens again. The City Engineer even acknowledged the communication problems on High Street West and said “in the future we will provide better communication.” CFIB also agrees with the City Engineer when he said “this project went as bad as you could have something go.” CFIB hopes the City learned a valuable lesson and will work harder to ensure this never happens again.
10. Do you have anything else to add?
We are not asking the City to compensate every business owner; only those who have been the most severely impacted by the construction delays. These business owners are not looking for special treatment; they simply want to be treated fairly and be compensated for their loss of sales.
We also know that there are a number of business who continue to be impacted by the construction delays on High Street West. If you are one of them CFIB need to hear from you! Please call our Saskatchewan office at (306) 757-0000, 888 234-2232 or email mssask@cfib.ca.